India

India

India's turbine makers complain of discrimination

1 February 2013
by Catherine Early

India: Wind is being discriminated against compared to other sources of energy, the Indian Wind Turbine Manufacturers Association (ITWMA) has claimed in its submission to government ahead of this month's budget.

DV Giri: Coal is still eligible for wind benefit

The ITWMA wants the government to reinstate the benefit known as accelerated depreciation (AD), which allowed developers to save tax on their wind investments. It was withdrawn last April. As many as 70% of wind energy installations in 2011-12 were as a result of AD.

However, coal-fired power stations still receive AD, the ITWMA pointed out.

"Coal, which is polluting, gets AD," said DV Giri, secretary general of the ITWMA. "(So) wind, which is not polluting and has free fuel, is being discriminated against."

The ITWMA also wants the government to waive the 5% customs duty for components used for wind farms. Solar-energy projects benefits from a duty-waiver.

Wind energy projects should be included in a priority lending category to speed-up financial closure, be eligible for lower interest rates and longer lending tenures, the ITWMA says.

Generation-based incentive

The submission does not mention the generation-based incentive (GBI) support scheme. This encouraged energy production rather than just installations with an incentive level of INR 0.5/kWh ($0.009/kWh) and was withdrawn at the same time as AD.

Previously, the industry had been calling for the reinstatement of the GBI. But Giri said that the GBI was due to be brought back by early February.

"GBI is for sure, absolutely," said Giri. He added that the Indian government's finance committee had met to discuss the GBI and it will now go to the cabinet.